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IForex Market Trading Signals and News – 18 May 2016

MARKET UPDATES :

Forex -Sterling pares back gains as U.K. inflation slows

Forex -Dollar holds steady, string of U.S. data on tap

Forex- Aussie and kiwi move higher on RBA minutes, oil rally

EUR/USD
EUR/USD was virtually flat on Tuesday, as investors digested hawkish signals from the Federal Reserve on the increased likelihood of multiple interest rate hikes from the U.S. central bank this year despite the release of subdued core inflation figures earlier in the session. The currency pair traded in a tight range between 1.1302 and 1.1347, before settling at 1.1314, down 0.0001 or 0.01% on the session. The euro has closed lower against the dollar in three of the last four sessions and nine of the last 11. Though the euro is only up modestly against the dollar over the last month, it still remains up by more than 4% against its American counterpart since the start of 2016. Incredibly, EUR/USD is only down 0.0003 from its level 52 weeks ago. EUR/USD likely gained support at 1.0538, the low from December 3 and was met with resistance at 1.1713, the high from Aug. 24.

GBP/USD
The pound pared back gains against the dollar on Tuesday after data showing that the rate of inflation in the U.K. slowed in April for the first time since September 2015. GBP/USD was last at 1.4458, down from around 1.4494 ahead of the report. The Office for National Statistics reported that the consumer price index rose by an annualized 0.3% in in April, slowing from 0.5% in March.Economists had expected the rate of inflation to remain stable at 0.5%. Consumer prices rose just 0.1% from a month earlier in April, slowing sharply from 0.4% in March and below forecasts for a gain of 0.3%.Falling air fares and price drops for clothing, vehicles and rent charged for social housing were the main contributors to the slowdown in inflation, the ONS said. Air fares fell by 14.2% in April, having jumped in March to take advantage of holidaymakers travelling for Easter.